Trinidad and Tobago Economic Outlook
A resource-rich economy:
Trinidad and Tobago is the wealthiest Caribbean nation on a per capita basis, with a GDP of around $25 billion, largely driven by its vast energy resources. As a leading producer of natural gas and petrochemicals, the country has historically benefited from strong export revenues. However, the economy has struggled with volatility due to fluctuating global energy prices, experiencing a recession between 2016 and 2019 before being hit hard by the COVID-19 pandemic in 2020. A subsequent recovery has been uneven, with growth remaining below pre-pandemic levels.
Energy sector dominance and economic diversification challenges:The oil and gas sector accounts for nearly 40% of GDP and 80% of export earnings, making Trinidad and Tobago highly dependent on global commodity prices. The country is a major supplier of liquefied natural gas (LNG) to global markets, with significant reserves sustaining long-term production. However, declining oil output and aging energy infrastructure have raised concerns about future growth. The government has sought to diversify the economy by investing in manufacturing, tourism, and financial services, but progress has been slow.
Fiscal imbalances and inflationary pressures:While the country has maintained a relatively high standard of living compared to regional peers, fiscal deficits have widened due to lower energy revenues and increased public spending. Public debt has risen to over 70% of GDP, prompting the government to introduce tax reforms and austerity measures. Inflation, while moderate by regional standards, has increased due to higher import costs and supply chain disruptions, impacting consumer purchasing power.
Challenges in labor markets and investment climate:The country has one of the lowest unemployment rates in the region, but this is partially due to an aging population and a shrinking labor force. Brain drain remains a persistent issue, with skilled workers seeking better opportunities abroad. Additionally, bureaucracy, crime, and regulatory inefficiencies have deterred foreign direct investment outside the energy sector. Addressing these issues will be critical for long-term economic stability.
Trinidad and Tobago’s economic outlook:GDP growth in Trinidad and Tobago is expected to remain modest at around 2–3% in the coming years, supported by continued energy production, infrastructure investment, and modest economic diversification efforts. However, structural weaknesses, including energy sector dependence, fiscal deficits, and governance challenges, could weigh on long-term prospects. To ensure sustainable growth, the country will need to accelerate diversification, improve the business climate, and enhance social and economic resilience.
Trinidad and Tobago's Macroeconomic Analysis:
Nominal GDP of USD 27.4 billion in 2023.
Nominal GDP of USD 27.4 billion in 2023.
Nominal GDP of USD 27.4 billion in 2023.
GDP per capita of USD 19,264 compared to the global average of USD 10,589.
GDP per capita of USD 19,264 compared to the global average of USD 10,589.
GDP per capita of USD 19,264 compared to the global average of USD 10,589.
Average real GDP growth of 1.2% over the last decade.
Average real GDP growth of 1.2% over the last decade.
Average real GDP growth of 1.2% over the last decade.
Sector Analysis
In 2020, services accounted for 64.8% of overall GDP, manufacturing %, other industrial activity 34.1%, and agriculture 1.1%. Looking at GDP by expenditure, private consumption accounted for % of GDP in 2016, government consumption 17.4%, fixed investment 8.8%, and net exports 73.8%.International trade
In 2021, manufactured products made up 69.1% of total merchandise exports, mineral fuels 23.8%, food 5.5%, ores and metals 0.8% and agricultural raw materials 0.0%, with other categories accounting for 0.8% of the total. In the same period, manufactured products made up 70.6% of total merchandise imports, mineral fuels 0.7%, food 17.7%, ores and metals 10.4% and agricultural raw materials 0.6%, with other goods accounting for 0.0% of the total. Total exports were worth USD 10.40 billion in 2023, while total imports were USD 6.60 billion.Main Economic Indicators
Economic growthThe economy recorded an average annual decrease of 1.2% in the decade to 2023. To read more about GDP growth in Trinidad and Tobago, go to our dedicated page.
Fiscal policy
Trinidad and Tobago's fiscal deficit averaged 5.8% of GDP in the decade to 2023. Find out more on our dedicated page.
Unemployment
The unemployment rate averaged 4.3% in the decade to 2023. For more information on Trinidad and Tobago's unemployment click here.
Inflation
Inflation averaged 2.8% in the decade to 2024. Go to our Trinidad and Tobago inflation page for extra insight.
Monetary Policy
Trinidad and Tobago's monetary policy rate ended 2024 at 3.50%, up from 3.25% a decade earlier. See our Trinidad and Tobago monetary policy page for additional details.
Exchange Rate
From end-2014 to end-2024 the Trinidad and Tobago dollar weakened by 4.5% vs the U.S. dollar. For more info on the Trinidad and Tobago dollar, click here.
Economic situation in Trinidad and Tobago
After shrinking in annual terms in H1 2024, the economy turned a corner in Q3: Recent data put GDP growth at 2.0% (H1: -1.9% yoy), the strongest in two years, on sturdier momentum in the domestic trade and manufacturing sectors. Shifting to Q4, the economy seemingly gained further steam. LNG output and tourist arrivals grew more quickly than in Q3 and oil output rose for the first time since Q1 2022. Heading into Q1 2025, momentum likely eased on surging gang violence and a state of emergency; LNG output fell in January–February and tourist arrivals cooled in Q1. In politics, the opposition center-left UNC party cruised to a surprise victory in April’s general elections. Fiscal constraints will limit its ability to fight crime and enhance social welfare, but efforts to diversify the economy away from oil and gas and toward tourism and manufacturing should aid activity in the longer term.Trinidad and Tobago Economic Forecasts
Projections out to 2034.39 indicators covered including both annual and quarterly frequencies.
Consensus Forecasts based on a panel of 8 expert analysts.
Want to get insight on the economic outlook for Trinidad and Tobago in the coming years? FocusEconomics collects projections out to 2034 on 39 economic indicators for Trinidad and Tobago from a panel of 8 analysts at the leading national, regional and global forecast institutions. These projections are then validated by our in-house team of economists and data analysts, and averaged to provide one Consensus Forecast you can rely on for each indicator. This means you avoid the risk of relying on out of date, biased or outlier forecasts. Our Consensus Forecasts can be visualized in whichever way best suits your needs, including via interactive online dashboards , direct data delivery and executive-style reports which combine analysts' projections with timely written analysis from our in-house team of economists on the latest developments in the Trinidad and Tobago economy. To download a sample report on the Trinidad and Tobago's economy, click here. To get in touch with our team for more information, fill in the form at the bottom of this page.